Business Law

Chapter 6
Intellectual Property and
Internet Law
 Objectives
Identify intellectual property
Discuss the law’s protection for
trademarks
Define the law’s protection for
trademarks on the Internet
 Objectives
Describe the protection that the law
provides for patents
State the law’s protection for
copyrights
Discuss how licensing can protect
intellectual property on the Internet
 Intellectual Property
Any property resulting from intellectual,
creative processes—the products of an
individual’s mind.
Article I, Section 8 of the Constitution
—”promote the Progress of Science and
useful Arts, by securing for limited times to
authors and inventors the exclusive right to
their respective writings and discoveries”
 Intellectual Property
Trademarks and Related
Property
Patents
Copyrights
Trade Secrets
 Trademark
A distinctive mark, motto, device, or
implement that a manufacturer stamps,
prints, or otherwise affixes to the goods
it produces so that they may be
identified on the market and their
origin vouched for
 Trademark Infringement
One who does not own a
trademark copies it to a
substantial degree or uses it in
its entirety
 Trademark Protection
Inherently distinctive
Fanciful – invented words (Xerox, Kodak)
Arbitrary – actual words used with products
that have no literal connection (English
Leather)
Suggestive – suggests something about a
product without describing the product
directly (Dairy Queen)
 Trademark Protection
Descriptive terms, geographical terms, and
personal names not inherently distinctive
Must acquire a secondary meaning
Calvin Klein
Advertising, market, sales
Generic terms (bicycle, computer) – no
protection
 Trademark Registration
First to use it or first to register it
Once registered, a firm is entitled
to its exclusive use for marketing
purposes
Registration helps prove the date of
inception of its use
 Service Mark
A mark used in the sale or the
advertising of services, to
distinguish one from another
Airlines
 Certification Mark
Used by one or more persons other
than the owner to certify the region,
materials, mode of manufacture,
quality, or accuracy of the owner’s
goods or services
Good Housekeeping Seal of Approval
UL Tested
 Collective Mark
A certification mark used by
members of a cooperative,
association, or other organization
Movie credits for various
associations
Union marks
 Trade Name
A name used in commercial
activity to designate a particular
business, a place at which a
business is located, or a class of
goods
Safeway
 Cyber Marks
A trademark in cyberspace
Domain name
A series of letters and symbols used
to identify site operators on the
Internet; Internet “addresses.”
 Infringement
In cyberspace, no two businesses can
own the same domain name
The unauthorized use of another’s
mark in a domain name constitutes
trademark infringement if confusing to
customers
 Cybersquatting
A person registers a domain name that
is the same as, or confusingly similar
to, the trademark of another and then
offers to sell the domain name back to
the mark’s owner
Anticybersquatting Consumer Reform
Act (ACRA) of 1999
 Domain Name Disputes
Internet Corporation for Assigned
Names and Numbers (ICANN)
Uniform Domain Name Dispute
Resolution Policy
Identical or confusingly similar
No rights or legitimate interest
Registered and used in bad faith
 Cyber Mark Infringement
Meta Tags
Key words for search engines
Using another’s trademark in a meta tag
without permission is infringement
Dilution
Using a trademark in a way that
diminishes the distinctive quality of the
mark
 Patents
A government grant that gives an inventor
the exclusive right or privilege to make,
use, or sell his or her invention for a limited
time period.
Designs – 14 years
Inventions – 20 years
Genuine, novel, useful, and not obvious in
light of current technology
 Patent Infringement
May exist even though not all features or
parts are copied
Often, litigation is so costly that the patent
holder sells a license for use to the infringer.
In many cases, the costs of detection,
prosecution, and monitoring are so high that
the patents are valueless to their owners
 Business Process Patents
Computer systems and software
applications that make up business
processes, or means or methods of doing
business.
Example-Amazon.com owns a business
process patent for “one-click” ordering
 Copyrights
An intangible right granted by statute to the
author or originator of certain literary or
artistic productions.
After 1/1/78, automatic for life of author
plus 70 years
Publishing houses – 95 years from date of
publication or 120 years from date of
creation
 Copyright Protection
Literary works Pictorial, graphic,
and sculptural
Musical works
works
Dramatic works Films and other
Pantomimes and audiovisual works
choreographic Sound recordings
works Computer software
 Copyright Protection
“fixed in a durable medium”
From which it can be perceived,
reproduced, or communicated
Registration is not required
 Protected Expression
An idea cannot be copyrighted
The particular way an idea is
expressed is copyrightable.
 Copyright Infringement
Whenever the form or expression of an
idea is copied
Does not have to be exact, nor
complete
Exception – “fair use” doctrine
Criticism, comment, news reporting,
teaching, scholarship, or research
Copyrights in Digital Information
Copyright infringement
Electronic “copy” when loaded into RAM
Publishers must have freelance writer’s
permission to sell to e-publisher
Software circumvention
Digital Millennium Copyright Act of 1998
“fair use” exceptions
Copyrights in Digital Information
Service Providers’ Liability
ISP not liable for a customer’s infringement
if ISP is unaware
File-Sharing
Software that compresses and decompresses large
data files
Example – MP3, violation of copyright if the user
does not own the rights to the music
 Trade Secrets
Information or processes that
give a business an advantage
over competitors who do not
know the information or
processes
 Trade Secrets
Customer lists
Plans
Research and development
Pricing information
Marketing techniques
Production techniques
 Trade Secrets
Economic Espionage Act of 1996
Theft of trade secrets is a federal crime
Individual – imprisoned 10 years, fine
up to $500,000
Corporation – fine up to $5 million
Forfeiture of property acquired and
property used to acquire
 Licensing
licensing the use of a product is
one of the best ways to protect
intellectual property on the
Internet
International Protection
Paris Convention of 1883
Berne Convention of 1886
Trade-Related Aspects of
Intellectual Property (1994)